Litigation Privilege: (1) WH Holding Limited (2) West Ham United Football Club Limited V E20 Stadium LLP
The decision at the end of last year by the court of appeal in WH Holding and West Ham v E20 Stadium  EWHC 2784 (Ch) has provided important guidance on the extent to which litigation privilege may be applied to a company’s internal documents.
The Court of Appeal decision arises out of West Ham’s application, pursuant to CPR 31.19(6)(a), for the court to inspect a number of emails, by way of a sample of redacted disclosure, in relation to which privilege had been asserted. The emails were between E20 board members and E20 Board members and stakeholders.
At first instance the High Court (the decision of Norris J) dismissed West Ham’s application for the court to inspect the documents over which privilege was claimed, and upheld E20’s claim to privilege on the basis that the emails fell within “conducting litigation” and were therefore privileged. West Ham appealed the decision and the Court of Appeal heard the application on 15 November 2018.
There were three grounds of appeal:
- the scope of litigation privilege;
- the grounds upon which the court will be prepared to inspect documents where there is a challenge to the assertion of privilege; and
- the application of the “dominant purpose” test in relation to documents produced for more than one reason.
The Court of Appeal decided to allow the appeal on the first ground, being the scope of litigation privilege. The real issue under the first ground was whether litigation privilege extends to documents which are concerned with the settlement or avoidance of litigation where the documents neither seek advice or information for the purpose of conducting litigation nor reveal the nature of such advice or information. Privilege was claimed on the basis that “…the dominant purpose of discussing a commercial settlement of the dispute when litigation with [West Ham] was in contemplation.” The Court of Appeal did not consider that a claim in those terms falls within the scope of litigation privilege.
The Court of Appeal’s conclusions were as follows:
- Litigation privilege is engaged when litigation is in reasonable contemplation.
- Once litigation privilege is engaged it covers communications between parties or their solicitors and third parties for the purpose of obtaining information or advice in connection with the conduct of the litigation, provided it is for the sole or dominant purpose of the conduct of the litigation.
- Conducting the litigation includes deciding whether to litigate and also includes whether to settle the dispute giving rise to the litigation.
- Documents in which such information or advice cannot be disentangled or which would otherwise reveal such information or advice are covered by the privilege.
- There is no separate head of privilege which covers internal communications falling outside the ambit of litigation privilege as described above.
The judgment also contained the following comment in relation to internal corporate communications:
“We cannot see any justification for covering all internal corporate communications with a blanket of litigation privilege. Quite apart from anything else we do not see why corporations should have greater protection than, say, partners or bodies of trustees who in practice are equally likely to discuss matters among themselves.”
The decision is a departure from previous decision on this issue, and restricts litigation privilege to documents produced for the purposes of obtaining information or advice in relation to the conduct of litigation. Corporations should therefore be alert to the nature and content of their internal documents and emails particularly when discussing commercial settlements.
The full judgment can be found here: https://www.bailii.org/ew/cases/EWCA/Civ/2018/2652.pdf
Alice studied Law at University. She completed her LPC at the College of Law, London, whilst working for the corporate crime team of an international firm. She trained with, and went on to develop her practice at a boutique litigation firm in Mayfair before joining Byrne and Partners in November 2017.
Alice is an Associate member of the Chartered Institute of Arbitrators.
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